Echo Bay completes Muscocho acquisition

Edmonton-based Echo Bay Mines (TSE) has completed the purchase of $23.5 million in convertible debt securities of Muscocho Explorations (TSE), Flanagan McAdam Resources (TSE) and McNellen Resources (VSE), the company said recently.

The $23.5-million figure represents the balance of $50 million which Echo Bay is spending to acquire a significant minority interest in the Muscocho Group of companies.

Comprised of loans convertible into common shares of the Muscocho group of companies, the convertible debt securities combine with $26.5 million in common shares to give Echo Bay a 20% stake in Muscocho, 22.4% of Flanagan McAdam and 26.6% of McNellen.

Under the terms of a revised agreement, Echo Bay paid a premium for its Muscocho Explorations interest.

The Muscocho group appointed two Echo Bay executives to sit on their respective boards at a special shareholders’ meeting.